NEW YORK— Edelman, the world's largest PR firm, has reported organic growth of 8.5% for its fiscal year 2015 — which ended on June 30 — taking its global revenue to $833m.
Last year we reported that for the fiscal year ending 2014, Edelman grew (on a reported basis) by 10.3% to to $776.5m.*
Despite growth being slightly less than FY 2014, CEO Richard Edelman called the performance “good, especially as we are making the transition from competing with ad firms, media agencies and media itself.” Edelman’s growth is ahead of the global PR industry average, which was 7% in 2014 — taking into account that independents grew by 8.7% and the publicly-traded firms grew by 3.5%.
The US continues to be a strong market with revenues up 9% to $504.7m, meanwhile the aggregated international markets grew by 7.5% to $328.3m. Breaking it down by region, both Latin America and Canada jumped by nearly 13%; Europe — including the UK — was more sluggish at 6.1%; and the emerging markets of Asia Pacific, Africa and the Middle East grew by 14.1%.
Continuing with the ongoing trend, organic digital’s growth was twice that of traditional PR — holding steady at 20% of worldwide revenue. For Edelman, digital spans community management, SEO, paid buys, analytics and emerging technologies like virtual reality.
Edelman points to the firm's work with Adobe on its Cannes Lions-winning campaign the “Photoshop Murder Mystery” as indicative of its digital muscle. While Edelman forecasted a resurgence in app development services last year, so far, that hasn’t panned out.
“We’re building our account teams differently — it’s hard to now to separate out brand, corporate and research/analytics,” Edelman pointed out. “The power happens when you bring those together.”
As part of this, Edelman moved its creative services and planning function from being a part of its digital offering into the “main-house.” The firm’s hiring of former BBDO exec Carol Potter, Edelman says, demonstrates how much creative services have been elevated within the firm.
“It’s not like an ad agency where you have a creative team sitting separately,” said Matthew Harrington, global operating officer. “It’s integrated into the way we work with clients, it’s all part of the team.”
Edelman reaffirmed his hope that multinational companies will opt for a best-in-breed approach rather than making deals for one holding company to supply all of marketing vendors. He also reiterated Edelman’s plans to keep earned media at the center of its offerings with paid services supporting these efforts.
Last year, the firm made some notable changes to its leadership, for instance Russell Dubner stepping in as US CEO, the sector/practices reporting into Ben Boyd, Jennifer Cohan taking charge of Edelman’s biggest office, in addition to significant turnover within its sector leads.
“It’s gone extraordinarily well — everyone is executing on the vision,” Edelman noted. He pointed out that Dubner’s transition has been “seamless” and Cohan has been “fantastic” as president of the New York office.
Vice chairman Alan VanderMolen is still on leave, Edelman noted when asked about his status within the company. We previously reported that VanderMolen has been on leaveamid the company's probe into its controversial CCTV relationship.
While growth was strong across most of its sectors, technology saw continued slow performance. “Last year was unique, we had lots of big companies splits,” Edelman noted. “But clearly we need a bigger presence in the unicorn category [of startups valued at $1billion+]. But I think our clients are back to growth, especially if you look at Microsoft and Samsung.”
Among the firm’s standout campaigns in FY 2015, Edelman said he’s “amazingly proud” of the work the firm did with CVS around its policy to stop selling tobacco products, as well as pointing to the firm’s ongoing work with Unilever’s Dove brand and Samsung mobile.
*In computing this year’s figures, Edelman totaled FY 2014 as $768.5m because of $8m that has “flipped” to sister firm Zeno in several markets.